MDNews - Greater Boston

+++++++++++++++++++ + +++ + REAL ESTATE U +++ +++++++++++++++++++ Trends in the Greater Boston Medical Office Market HEALTHCARE REFORM, COMPETITIVE LANDSCAPE UP THE ANTE FOR PROVIDERS' REAL ESTATE STRATEGIES. T landscape is reflected in real estate strategies across the country, and Greater Boston is no exception. The past 12 months have been the most active in off-campus development in more than a decade, as increasing competition drove dozens of new facility construction projects, relocations and renovations of medical office space. The arrival of the urgent care model to eastern Massachusetts is a prime example of one of these trends. While the walk-in/ urgent care concept is far from new, the number of such facilities in Greater Boston will have tripled by the end of 2013. The ability to deliver fast, more convenient care (often at a lower cost) by creating satellite emergency departments is attractive to patients and profitable for providers. The first wave of activity came from HE CHANGING HEALTHCARE 303 Boylston Street Brookline, MA FULL BUILDING CONTROL 17,577 SF of Medical | Academic | Office available in the Brookline/Longwood Medical Area. (617) 330-6966 14 | Greater Boston MD NEWS I MDNEWS.COM Managed by: privately owned and franchised companies often spearheaded by a group of local physicians. The potential leakage that resulted from this movement led almost all major hospitals and health systems to include an urgent care component in their new off-campus sites. Parallel to the proliferation of urgent care centers has been the partial migration of care to a more retail setting. The benefits of locating in space that offers street-level identity and exposure to foot traffic has led some practices away from the traditional medical office environment. Among the sacrifices providers make for this type of location are a potential loss of inter-referrals that result from synergies within medical buildings, a lack of control over surroundings (e.g., a liquor store could move in next door) and higher-than-average build-out costs. All risks considered, it is almost certain that any comprehensive space study for a practice relocation will turn up viable options in nontraditional real estate. The Blockbusters of yesterday, typically 5,000–6,000 square feet in size with prominent signage and adequate parking, have become the solution for dozens of medical providers in the Boston suburbs. While competition and renewed strategies in the wake of healthcare reform are driving hospitals, physician organizations and private practices to relocate into new facilities, decisionmaking factors remain consistent. Economics and occupancy costs are paramount to the equation, as the unanimous goal has become cost control without sacrificing quality of care. The intense competition for market share has forced providers to find ways to enhance the patient experience outside the realm of medical care — convenient access, parking, waiting room aesthetics and amenities are top-of-mind for physicians and practice administrators. The amenity base of a medical office location is important in a number of ways. The ability to deliver imaging and diagnostic lab services without leaving the building is as important as ever, and the ability to get coffee without leaving the parking lot a close second. The rising popularity of integrative wellness, partially encouraged by healthcare reform, is also playing a role in medical office space decisions. Practices are expanding their services to include offerings, such as acupuncture, massage, nutrition counseling and wellness education as part of medicine's shift to a preventive maintenance model. This has led many practices to

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